Current practice among manufacturers of pulse oximeters is to calibrate an instrument prior to shipment according to a calibration curve based on measurements obtained from a group of human subjects. No means for checking the calibration of pulse oximeters in the clinic now exists. We are designing a device for calibrating pulse oximeters that simulates the optical properties of a pulsating capillary bed containing various fractions of oxygenated and deoxygenated hemoglobin. The design of the calibrator is based on liquid-crystal light modulators which are used to set the dc and modulated (ac) light intensities passing through the "capillary bed. " By adjusting the ac/dc intensity ratios in wavelength bands in the red (630-690nm) and infrared (800-1000nm) the display of the oximeter can be set to the desired oxygen saturation (SO2) value.